Health insurance claim got rejected? Here's what you need to do now However this moment of truth turns into a bitter experience if your claim is rejected. Here is what you can do to make sure that your rightful claim is honored to your satisfaction
Most people buy health insurance policies with the hope they never have to use it but with the confidence the policy will come to their rescue in case of an eventuality. However, their moment of truth comes when they seek the policy’s support. Many people’s claims get rejected though they have been regularly paying the premium.Such a rejection can come as an unimaginable shock to policyholders, especially if they were heavily depending on this cover to bail them out. If you face such a situation, you must know your options to get the claim amount that rightfully belongs to you.
What to do after your health insurance claim gets rejected?
First, study the reason for the rejection and the course of action recommended in the policy. “The policy itself will give the protocol for raising a claim and taking it forward in the event of rejection. Most insurance companies have established procedures in this context,” says Sanjay Sen, senior advocate, Supreme Court of India. You can approach the grievance redressal officers (GRO) of the concerned health insurance company.
Policyholders can approach the ombudsman concerned in case of a rejection, but only after approaching the insurance company first.
“If an insurance claim is rejected by an insurer or if the claim amount awarded is lower than the expense being sought to be covered under the policy, the aggrieved policyholder is required to first file a complaint with the insurer concerned before approaching an ombudsman. Thereafter, the complainant can approach an ombudsman or a consumer court, but not both simultaneously,” says Shoubhik Dasgupta, Partner, Pioneer Legal.
Is it necessary to file an appeal again with the health insurance company after rejection of the claim? Manmeet Kaur, Partner, Karanjawala & Co. suggests that it is not necessary to file an appeal with the health insurance company again after rejection of the claim. “However, in cases where the insurance companies have denied the claim while informing about the reasons of such rejection/denial, the policyholder can refile the claim after rectifying such deficiencies,” suggests Kaur.
But once policyholders have no other option left, they can approach the appropriate external forum.
Escalate it to IRDAI
You can approach the Grievance Redressal Cell of the Consumer Affairs Department of IRDAI by calling the Toll Free Number 155255 (or) 1800 4254 732 or by sending an e-mail to [email protected]. Besides this you also have the option to use the online portal managed by IRDA called Integrated Grievance Management System (IGMS). This is a way of escalation of your grievance so it should only be used after you have tried the grievance redressal channel of the insurance company. If you are not able to access the insurance company directly for any reason, IGMS provides a gateway to register complaints with insurance companies.
Where should you appeal first, ombudsman or the court?
If your grievance is still not addressed by the insurance company to your satisfaction, you have two options — approach the insurance ombudsman or the courts. Where should you go first? It is not mandatory in the escalation ladder that aggrieved policyholders should go to the insurance ombudsman first. “The aggrieved policyholder is not required to approach the insurance ombudsman before approaching the courts. The policyholder can directly approach the consumer forum,” says Kaur.
However, there is no harm in exercising the option of approaching the insurance ombudsman first. “It may be beneficial to exhaust that process. It's more of a mediation process that results in a recommendation and is not really an adjudication of one's claim,” says Sen.
The insurance ombudsman specialises in dealing with such cases and it may be a convenient route for aggrieved policyholders as well. “In my opinion, insurance ombudsman, specifically set up to address grievances relating to insurance claims, is a better forum as it is time-bound and any award from the ombudsman is subject to acceptance by the complainant in full and final settlement of the complaint,” says Dasgupta.
You can approach the court if the ombudsman order is not favourable
If policyholders feel that the order of an insurance ombudsman does not meet their expectation, they can take legal recourse.They can either approach a civil court or a consumer court. “If the consumer does not accept the award of the ombudsman, the normal legal process of approaching courts (including consumer courts) can be followed,” says Dasgupta.
Should you go to a civil court or a consumer court?
Dasgupta says approaching a consumer court or an ombudsman is easier and cost effective as even a simple letter can become a valid complaint; policyholders need not engage a lawyer for such cases. Going to a consumer court may give the complainant an edge.
Consumer court has the jurisdiction: The matter falls under the jurisdiction of the consumer court and so might help the policyholder. “It is a better option for the policyholder to go to the consumer court as the consumer forum is authorised to listen to complaints from every person who falls under the definition of consumer,” says Kaur.
Consumer court is a less costly option: It will be easy on your pocket. “Certainly, the consumer court is a better option. It's less expensive and less formal in terms of procedures, timelines, etc. The consumer courts have, over the years, developed a well-established jurisprudence on the subject and can effectively redress the concerns of the complainant,” says Sen.
Consumer court will take less time: There is speedy trial in consumer court. “One of the primary benefits of consumer forums are speedy redressal and providing consumers with access to justice and ensuring that consumer grievances are heard and addressed in a fair and impartial manner,” says Kaur.
Insurance company is more likely to honour the judgement: While lodging the complaint in a consumer court, many policyholders may have doubts whether the insurance company concerned will honour the claim of a consumer court or go for further litigation. The chances of an insurance company honouring your claim are higher. “Insurance companies are highly likely to honour an adverse judgement from a consumer forum after finality of the order. Once the order is final; consumer has a right to get it executed under Section 71, Consumer Protection Act, 2019,” says Kaur.
Factors a policyholder should keep in mind before approaching a court
Policy should be active and valid: “The policyholder should ensure that the policy premium has been paid, all documentation and information with respect to the medical history, present or past, have been given to the insurer at the time of availing the policy. At the time of claiming the insurance, there must be a valid policy which covers the ailment. The policyholder should ensure that he has provided the insurer with the proper medical record and proof of admission/discharge summary,” says Kaur.
All relevant documents against the claim to be shared: “In all cases, documentation both before and after lodging of claim is important. The claim should be one that is covered by the policy, and, as such, all supporting documents should be indexed and lodged,” says Sen.
True disclosure by the policyholder in the policy: Insurance is a contract between the policyholder and insurance company on the basis of good faith and, hence, all the information shared by the policyholder at the time of issuance of the policy should be correct.
“One has to ensure that disclosures at the time of making the policy are truthful, and there should not be any material concealment. Often, brokers and agents mislead and want to close a policy by making wrong disclosures,” says Sen.
If any material information was not disclosed, it will work against the policyholder. “In case of medical insurance, medical reports have to be accurate. Disclosures regarding smoking, illnesses, previous events, hospitalisation, etc, should be truthfully made. In a digital age, wrong disclosures and representation can be easily found out, resulting in invalidation of the contract,” says Sen.
Courts won’t give policyholders a favourable judgement if there is concealment of facts that can lead to doubts over their bona fides. Experts say complainants have to ensure they are presenting facts before a court. “Rejection of health insurance policy claims on the grounds of concealing material information, such pre-existing medical conditions or unhealthy habits such as smoking, is usually not overturned by consumer courts or ombudsman,” says Dasgupta.
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This story originally appeared on: India Times - Author:Faqs of Insurances
